Hoteliers, we are already in that time of year again: marketing budget planning season. In this environment of uncertainty and mixed economic news, many hotel owners and operators are finding themselves in a state of confusion. Should hoteliers be proactive by raising their marketing budgets, or is it safer to be reactive and wait to see what will happen with the economy over the next few months?
For over two solid years, hoteliers found themselves having to accomplish more with less. They faced the end of 2008 and the beginning of 2009 with slashed marketing budgets, staff cuts, and an even more urgent need to show the ROI of every dollar spent. Needless to say, it was a challenging time for many of us in the industry. In 2011, however, it’s time to be more ‘cautiously optimistic.’ It’s time to un-shrink the hotel marketing budget!
2011: The Good News and the Bad News
Let’s start with the good news. All signs are pointing to yes, the hospitality industry is in recovery mode. The industry projects to end 2010 with important increases in two of the three key performance measurements, according to the latest forecast of Smith Travel Research (STR). In 2010 occupancy is expected to increase by 4.4% and RevPAR by 4.3%, while ADR is expected to end the year flat. In 2011 occupancy will grow a further 1.4% while RevPAR will increase by 5.3% and ADR by 3.9%.